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Wednesday, 14 March 12
GLOBAL THERMAL TRADE FLOW CHANGES WILL ENSURE SECURITY OF THERMAL COAL SUPPLY, ALBEIT AT A HIGH PRICE - WOOD MACKENZIE
 Wood Mackenzie Says Global Thermal Trade Flow Changes Will Ensure Security of Thermal Coal Supply, Albeit At a High Price Seaborne thermal demand by 2030 will be driven by China at 1btpa and India at 400mtpa
At Coaltrans India today, Wood Mackenzie said that a significant growth in demand for seaborne thermal coal from China and India- the top two demand drivers by 2030, will lead to a change in global trade patterns. The increase in the seaborne trade will ensure the long-term security of thermal coal supply in the Asian region. Despite forecast ample supply, Wood Mackenzie indicated that investors and buyers should expect prices to stay at traditionally high levels over the foreseeable future.
Mr. Prakash Sharma, Presenter and Coal Market Analyst says, “China has evolved rapidly to become the world’s largest thermal coal importer with seaborne demand set to grow from 175 million tonnes per annum (mtpa) in 2011 to 1billion tonnes per annum (btpa) by 2030. India is also set to overtake Japan as the second largest consumer of thermal seaborne coal by 2030, growing from approximately 80 mtpa in 2011 to 400 mtpa. India’s demand may be even higher if domestic supply is constrained by delays in associated rail and port infrastructure projects.”
A major expansion in global thermal coal trade, concentrated on Asia and driven by demand from both China and India, is expected over the next 20 years. Rapid economic expansion will fuel demand for electricity, and the heavy reliance of Asian economies on coal will lead to an increase in trade flows. In the near-term, the market will be tight but a significant growth of thermal seaborne supply is expected to come from existing and emerging basins, creating a change in trade flows that will feed long-term demand.
Mr. Sharma says, “With Asia at the centre of future thermal coal import requirements, current Pacific Basin suppliers will be first in line to benefit. Waiting in the wings though are emergent players some of which, particularly in Australia and the US, will make up a significant portion of their region’s future supply growth.”
“The emerging basins to keep an eye on are Australia’s Surat and Galilee basins, Indonesia’s Kalimantan and Sumatra basins as well as basins in Mozambique, Mongolia, Russia’s Far East, and the west coast of the United States. South African coal will continue its migration from Europe to Asian markets, and other Atlantic Basin suppliers such as Colombia and the eastern US will also participate, albeit marginally.”
Despite aggressive expansions in thermal coal supply, long-term prices will defy expectations of a drop in prices, instead remaining high in the seaborne market. There may be short term seasonal fluctuations such as a dip in Q2 prices this year due to economic uncertainty but in the long-term, the Newcastle reference coal price will increase progressively and is forecast to remain above free on board (FOB) US$120/t in real 2011 US dollar terms.
The high prices can be attributed firstly to higher production costs and the substantial investment required in new mines and supporting infrastructure development particularly for new reserves from significant emerging basins. These are in remote regions far away from exiting port facilities. Secondly, cost pressures come from changing fiscal regimes such as the carbon tax in Australia and minimum export price regulations in Indonesia. Lastly, Wood Mackenzie expects a declining trend in export thermal coal quality as large volumes of low rank coals from Indonesia enter the seaborne market.
In summary, Mr. Sharma says, “Demand for seaborne thermal coal will grow exponentially from now until 2030, particularly as a result of China and India’s needs. While this demand will find supply from a change in trade flow patterns, we think that prices will not weaken with the oncoming supply. Rather, cost pressures, infrastructure bottlenecks and a decrease in export coal quality all combine to hold prices at traditionally high levels.”
About Wood Mackenzie
Wood Mackenzie is the most comprehensive source of knowledge about the world’s energy and metals industries. We analyse and advise on every stage along the value chain - from discovery to delivery, and beyond - to provide clients with the commercial insight that makes them stronger.
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Friday, 04 May 12
DEMOLITION KEY FOR DRY BULK MARKET RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The overflow of newbuilding vessels which “spilled over” into 2012 from 2011 brought the dry bulk market to a near collapse level at the ...
Thursday, 03 May 12
DRY BULK MARKET REMAINS INACTIVE, POSTING MILD DECREASE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept retreating this week, although at a very low pace, on the back of a lull in demand. The industry's benchmark, th ...
Thursday, 03 May 12
MINERS DEMAND LEGAL CERTAINTY ON PRE-BAN INTERIM POLICY - THE JAKARTA POST
The Jakarta Post reported that, Mining companies represented by the Indonesian Mining Association (IMA) welcomed the government’s plan to impo ...
Thursday, 03 May 12
HANDY EAST COAST INDIA - CHINA AROUND USD 7000 - FEARNLEYS AS
Handy - Stable demand in the Atlantic offered good rates for the tonnage.
USG/Cont was worth USD 17500 and more. Baltic and Black Sea appeared to ...
Wednesday, 02 May 12
CHINA BLACKOUTS HIGHLIGHT PRICING POLICY WEAKNESS - FITCH
Fitch reported that, the likelihood of further electricity blackouts in China this summer underlines Fitch's view of the basic problem f ...
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- London Commodity Brokers - England
- GVK Power & Infra Limited - India
- Economic Council, Georgia
- Larsen & Toubro Limited - India
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
- ASAPP Information Group - India
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Global Business Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Planning Commission, India
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Sarangani Energy Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Madhucon Powers Ltd - India
- Parliament of New Zealand
- OPG Power Generation Pvt Ltd - India
- GMR Energy Limited - India
- Bhushan Steel Limited - India
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Coastal Gujarat Power Limited - India
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Commonwealth Bank - Australia
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercuria Energy - Indonesia
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Authority, New Zealand
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- International Coal Ventures Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- PetroVietnam Power Coal Import and Supply Company
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- Bukit Baiduri Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Mintek Dendrill Indonesia
- Central Java Power - Indonesia
- Wood Mackenzie - Singapore
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- Star Paper Mills Limited - India
- Bukit Makmur.PT - Indonesia
- Mercator Lines Limited - India
- The Treasury - Australian Government
- Bahari Cakrawala Sebuku - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- Ambuja Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Standard Chartered Bank - UAE
- Sinarmas Energy and Mining - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Trasteel International SA, Italy
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- Ministry of Transport, Egypt
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Coal Association
- Videocon Industries ltd - India
- Orica Mining Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Formosa Plastics Group - Taiwan
- ICICI Bank Limited - India
- Banpu Public Company Limited - Thailand
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- Jaiprakash Power Ventures ltd
- Indian Oil Corporation Limited
- Karbindo Abesyapradhi - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Makarim & Taira - Indonesia
- Carbofer General Trading SA - India
- Holcim Trading Pte Ltd - Singapore
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Semirara Mining and Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Kideco Jaya Agung - Indonesia
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Sical Logistics Limited - India
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- Indian Energy Exchange, India
- Kalimantan Lumbung Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Orica Australia Pty. Ltd.
- Posco Energy - South Korea
- Electricity Generating Authority of Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PTC India Limited - India
- Thiess Contractors Indonesia
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Therma Luzon, Inc, Philippines
- Metalloyd Limited - United Kingdom
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- Lanco Infratech Ltd - India
- Goldman Sachs - Singapore
- Chettinad Cement Corporation Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Energy Development Corp, Philippines
- Leighton Contractors Pty Ltd - Australia
- Independent Power Producers Association of India
- Oldendorff Carriers - Singapore
- Interocean Group of Companies - India
- Kobexindo Tractors - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- Riau Bara Harum - Indonesia
- Malabar Cements Ltd - India
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Africa Commodities Group - South Africa
- Antam Resourcindo - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- GN Power Mariveles Coal Plant, Philippines
- AsiaOL BioFuels Corp., Philippines
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- Iligan Light & Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- The University of Queensland
- Thai Mozambique Logistica
- Rashtriya Ispat Nigam Limited - India
- PowerSource Philippines DevCo
- Directorate Of Revenue Intelligence - India
- Mjunction Services Limited - India
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- SMC Global Power, Philippines
- Siam City Cement PLC, Thailand
- Attock Cement Pakistan Limited
- Latin American Coal - Colombia
- Globalindo Alam Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Karaikal Port Pvt Ltd - India
- Medco Energi Mining Internasional
- Bulk Trading Sa - Switzerland
- Global Coal Blending Company Limited - Australia
- Aboitiz Power Corporation - Philippines
- Tata Chemicals Ltd - India
- Rio Tinto Coal - Australia
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Anglo American - United Kingdom
- South Luzon Thermal Energy Corporation
- Tamil Nadu electricity Board
- Eastern Coal Council - USA
- Petron Corporation, Philippines
- Baramulti Group, Indonesia
- Savvy Resources Ltd - HongKong
- Kumho Petrochemical, South Korea
- New Zealand Coal & Carbon
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- Intertek Mineral Services - Indonesia
- Eastern Energy - Thailand
- Aditya Birla Group - India
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Indika Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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